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The privileged should be prepared to pay

he universities have been in financial crisis for more than two decades. Spending per student has halved, and the number of students per lecturer more than doubled.

Academics have been reduced to paupers, university buildings to slums. It was characteristically irresponsible of the Tories to expand higher education without raising funds to pay for it.

Most traditional Labour supporters would say that the answer is to raise taxes on the more affluent. I say we should do that anyway, and spend it on `the NHS and the schools.

I would prefer to keep universities away from general taxation: governments always demand a detailed account of how it is spent and, in a labour-intensive industry, that leads to a monstrous bureaucracy checking how academics spend every waking hour.

It is bad enough in the schools, but it is wholly against the spirit of higher learning and scholarship.

The case for charging realistic fees to the students themselves - and leaving them to decide if they are getting value for money - is therefore overwhelming. A degree will deliver, on average, an extra 17 per cent in lifetime earnings. Privilege thus begets privilege.

The present flat-rate annual fee of pound;1,100 hardly helps at all. Not only is it a mere fraction of the true costs of courses, it also fails to acknowledge that some universities are more expensive than others and some degrees worth more than others.

Oxford students are even more middle-class than students generally, and their degrees will bring even higher earnings, yet they pay the same as everyone else.

Two objections are made to top-up fees. First, assuming they are financed through cheap, repayable loans, they will add, it is said, to the "burden of debt" on graduation. But if loan repayments are wholly contingent on earnings (and preferably collected through a tax or national insurance coding) the graduate will barely be conscious of debt.

Moreover, loans can serve as instruments of social policy. Medical graduates - who now receive the highest subsidies because their courses are so expensive - could have repayments waived if they dedicated themselves full-time to the NHS. The loans themselves could be disbursed by local education authorities and given only to those educated in the state sector for a minimum of, say, five years.

The second objection is that high fees will exclude poor students, making the likes of Oxford and Cambridge even more elitist than they are now.

But if exemptions for the poor are sufficiently generous - under the present system one in three students pays no fees at all - they may have the opposite effect. Some Etonians (or their parents at any rate) might well be deterred by a pound;10,000 Oxford fee. This would free more places for those from poorer homes.

It is true that expansion of higher education - and expansion of working-class entry - has slowed since the fees were introduced, but this is largely because of a sharp fall in youth unemployment.

Many of my Labour comrades plead the virtues of social solidarity against those of concentrating resources on the poor. They argue that, wherever possible, public services should be free to the users so that everybody, rich or poor, has a stake in them and so thinks in terms of "our schools", "our hospitals", and so on.

This is an old strand in left thinking and I respect it. But I do not see how a service can express values of solidarity unless it is open to everybody, in the way that schools, hospitals, parks and libraries are. While universities remain selective, those they exclude should not be required to pay for them.

To argue that higher education brings higher economic growth, and therefore "everybody" benefits, is simply to accept a version of the right's discredited "trickle-down" theory.

To defy the strident middle-class protests on this issue, a politician will need both courage and conviction. Charles Clarke has the first. I hope he also has the second.

Peter Wilby is editor of the "New Statesman"

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